CDPHP, MVP, other health insurers seek major rate hikes in 2023 [The Daily Gazette, Schenectady, N.Y.]

Jun. 26—ALBANY — Health insurers are asking state regulators for their largest premium increases in several years — a weighted average of 18.7% for the individual market and 16.5% for the small group market.

By weighted average, the requests submitted by Capital Region-based insurers MVP Health Care and CDPHP range from 13.6% to 38.4%, with individual rate increases of as much as 48.2%.

The state Department of Financial Services reviews the requests submitted by insurers operating in New York and typically approves a lesser amount than originally requested.

In 2021, CDPHP and MVP requested premium increases ranging from 4.9% to 16.9% but were granted 3.4% to 9.0%.

The two insurers have a combined total of more than 1 million members but the requests they submitted last month for individual or small group coverage would affect only 11% to 12% of their membership.

Rate hike requests for large-group HMO coverage have not been submitted yet, and rates for certain other categories of health insurance are not regulated by the state.

CDPHP spokeswoman Ali Skinner said this isn't the first large rate hike request the Albany-based insurer has submitted, as the factors that drive up its costs are neither new nor unfamiliar.

However, the factors are all coming together at once in 2022, she said.

CDPHP has spent over $560 million on COVID care since early 2020; some of its members postponed care amid the worst of the pandemic and their conditions are now worse or more expensive to treat; medical costs have been rising for years; hospital mergers result in higher costs; and drug prices have been skyrocketing.

Pharmaceutical costs rose from 23% of claims submitted to CDPHP two years ago to 30% now, Skinner said.

"That's just eating up the premium dollar," she said.

There's also the mandates that grow more numerous each year in New York.

There are no fewer than 18 proposed new mandates approved by the Legislature and awaiting Gov. Kathy Hochul's signature, Skinner said. Taken as a whole, and given the way they'd be implemented, they would result in a significant cost increase for insurers, she said.

The industry group representing health insurers, the New York Health Plan Association, noted that New York state collects more than $6.5 billion annually in taxes on health plans, which raises the premium for a family policy more than $1,000 on average.

The state also mandates more than three dozen specific treatments and services that go beyond the guidelines of national health organizations, the association said, and each comes with a cost.

All of this translates to higher costs for employers that provide insurance to their employees and for the individuals who buy insurance themselves.

In a prepared statement, Schenectady-based MVP noted that it is a not-for-profit company.

"We understand the financial difficulties our customers may be facing due to the rising costs of goods and services, including health care premiums. MVP is committed to working with our customers to help them navigate their health plan options while identifying if customers are eligible for financial assistance to help pay for monthly health care premiums," it said.

"Our customers and our communities are facing inflation in nearly all aspects of life, from the gas station to the grocery stores. It is not lost on us that changes to health care premiums can add to that difficulty. The cost of health insurance and medical costs are linked. The proposed premium rate changes are a result of the underlying cost of care, inflation in health care prices, increased price of specialty pharmaceutical drugs, medical care, hospital budgets, and an anticipated increase in the utilization of more complex and costly health care services."

MVP said it does everything it can to maximize benefits and limit costs for members. It invited anyone with questions to call the customer care center at the phone number on the back of their insurance card.

Consumers can submit comment on the proposed rate increases to the state Department of Financial Services via its website.

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